Strategic Plan of Coca Cola Company

Strategic Plan of Coca Cola Company

Executive Summary of Coca Cola

Coca Cola Company has a history of being the leading company in good corporate citizens around the globe for more than 100 years. The Coca Cola system has an excellent global scale that the company is executing in a considerably localized manner, proving it crucial to steer the economic development, empower the communities, and preserve and protect the environment where the Coca Cola Company is doing its business. The company is now facing many threats in the current markets since the market is ever-changing. The company is facing the regulatory changes of the market, the social and economic changes, and market-driven changes.

The company will use the SWOT analysis approach to provide an insight into the environment. The external analysis of the company helps in understanding the situation of the industry. Internal review of the company helps the company to know the internal capabilities. The strategic plan will address the strategies the company will undertake to retain its customers in more than 200 countries, and the way the company is going to attract new customers after the implementation of the plan. The conclusion of this paper will provide the company with the measures to address the key issues that the paper will identify to continue with its achievement of being the leading maker of soft drinks.

Coca Cola Company (KO)

Company Overview

The Coca Cola Company is the leading producer of soft drinks in the world. The company has 15 billion worth of a dollar, that includes its four brands in the top five brands in the world. The four brands include Coca Cola, Fanta, Diet Coke, and Sprite. The company’s other top brands include vitamin water, PowerAde, and Minute Maid. The world’s largest soft-drink maker also licenses or owns and markets close to 500 beverage brands that include waters, juice drinks, sport and energy drinks, and sparkling water. With a sound distribution system that helps the company to reach out to its consumers in more than 200 countries around the globe. The company collects close to forty percent of its revenue in the United States.

In the year 2006, the company was operating in eight market segments of the world. The segments were Africa, European Union, North America, Latin America, Middle East, North Asia, Pacific Rim, East South Asia. The company mission is about refreshing the world to create inspiration during moments of happiness and optimism. Coca Cola Company has a mission to make a difference and create value for all its consumers around the world. Coca Cola Company believes that the success of the company lies in a variety of brands that they offer to their customers to satisfy their desires, needs, and lifestyles. The company has four areas of strategic priorities for their long term development and growth. The preferences include: accelerate innovation, drive beverage leadership, leverage the company balanced geographical portfolio, and lead the system of coca-cola for growth.

Company History

             Coca Cola Company came into existence in the year 1892. The company today manufactures carbonated soft drinks. Coca Cola company story began in the year 1886, in May, and is continues for hundreds of years, even during the times of peace and war, depression and prosperity, and during the economic boom. The company also produces beverage drinks that the company is selling to its customers around the world. The company became one of the biggest companies in the world during the year 1990, and earn a lot of respect around the globe. The Coca Cola Company is the top list as one of the biggest corporations in American and the world’s leading maker of nonalcoholic drinks.

The coca-cola drink originated in the year 1886 by John Pemberton, who was a pharmacist in Atlanta between the year 1831and the year 1888. Pemberton was using the syrup to treat some ailments since there was the presence of caffeine in the tonic. The removal of caffeine from the syrup led to the birth of coca-cola as a drink. Another pharmacist from Atlanta Asa Griggs Chandler incorporated the coca-cola company in the year 1893, to start producing soft drinks. The Coca Cola trademark got the United States office patent in the year 1893.

Products and or Services

The company for close to seventy years was only producing and selling the only coca-cola drink that the company invented in the year 1886 in Atlanta. Later in 1955, the company started to produce other brands and selling them to customers around the globe. The company expansion started Fanta orange drink was selling in Italy by a certain bottler. The company began to expand its brand variety and portion sizes after that. The world’s largest soft drink producer now believes in providing an assortment of drinks for every life stage, lifestyle, and life occasions. Currently, the Coca Cola Company produces over five hundred of beverage drinks to its customers around the world.

In Australia, the company sells and distributes food products and beverage drinks. In Australia, the company operates the beverage franchise for the production and distribution of the Coca Cola trademark products. The company product portfolio includes the functional beverage drinks and carbonated drinks such as Fanta, Coca Cola, Lift, and PowerAde drink. The company also produces and distributes health and wellbeing products such as a range of water, low-calorie beverages, and juice. Such brands include Mount Franklin, Neverfail, Nestea, and Fruit box. Food and services the company offers to offer jams, packed vegetables, and fruits. They include Goulburn Valley, SPC, IXL, and Ardmona products.

Operations of Coca Cola Company

            The company has a well-established production and distribution than other companies in the world. Coca Cola company ensures employees of the company work hard and try to sell the products of the company to its consumers all over the world.  The unique global distribution system and the production is making the company be one of the world’s makers and distributor of soft drinks across nations. The company targets everybody as its market, though the company tends to target the young generation age between eighteen and twenty-five. The company also targets children making them beverage brands like Bibo and manufactures soda water and coke for the older generation. The company is trying to meet the satisfaction of everyone they have identified as their market.

Moreover, the company requires more workforce due to its vast market worldwide. Coca Cola sells its products in almost the 200 nations but does not manufacture in all of them.  The company is working with other small retailers and chain retailers to try to improve their sales and reduce their operating costs. The company management is working tirelessly to create value for its customers in the world.

Vision

            The company vision provides a roadmap and the necessary guidelines for every step the company is taking. The vision outlines what the company requires to achieve to continue accomplishing its quality growth and sustainability.

People: Strive to be the right place of work where people can get inspiration to give their best.

Planet: Strive to be a very responsible citizen who can bring a difference in society by helping support and build a sustainable society

Portfolio: Offer to the world a variety of products that will satisfy their customers’ needs and desire around the globe

Partners: Develop a winning channel of suppliers and customers, that creates a mutual lasting value

Productivity: Strive to be highly productive

Profit: Maximize the sustainable return to the company shareholders and be mindful of the company’s responsibilities.

The company-new vision statement is to offer a pleasant working environment for the workers to give their best in the workplace.  Produce high-quality products to satisfy the customers’ different tastes to maintain sustainable societies for the younger and future generations and maximize profits for the shareholders.

Mission Statement

The Coca Cola Company roadmap begins with the company mission statement, which is lasting. The mission of the company declares the purpose of the coca-cola company providing the guideline where the company is making its decisions and actions.

The mission statement is to provide inspiration moments of happiness and optimism, refresh the whole world, and to make a difference and create value. The world is ever-changing, and the company needs to change with changing times in the market. The company must look ahead and try to implement the mission statement in every decision and action that they undertake to remain in the global market. The company must always be ready for today and tomorrow to be at the top as the world’s biggest producer of soft drinks. The company must analyze the ever-changing market trends and the forces that affect the market. The company develops strategies to overcome challenges that come and be ready for the future.

Corporate Values and Culture

            The company values outline the direction of the company’s action, and the Coca Cola Company carry out their business around the globe. The core values of the company include:

Leadership: The bravery to develop a better future

Integrity: Always be real

Passion: Always committed in mind and heart

Accountability: Always be accountable

Collaboration: Leverage shared genius

Diversity: always be inclusive of the way the company is.

The company culture provides the framework that defines behaviors and the attitudes that the company expects of every employee to have around the world. The culture will help the company to realize its vision.  The culture of the company demands the management of the company to inform the shareholders of their decisions from time to time and engage them in talks. The company culture recognizes the company to protect the environment and provide solutions in the fight against global warming. The culture of the company also ensures that the employees are safe in their workplaces. The company cultures also demand the company to collaborate with other companies to ensure that the Coca Cola continues to spread across the world.

Strength, Weaknesses, Opportunities, & Threats (SWOT) Analysis

Coca-Cola is the leading company in the Industry of soft drinks. This company is one of the most popular brands in the e whole world. It supplies both offices, homes, bars, hotels, even restaurants. About 955 of the population globally knows about this soft drink brand. This company was established in Atlanta in the year 1886. After this, it took very few years to become the most popular and widely used brand in the world.

This SWOT analysis of Coca-Cola shows how this company commands the most popular and widely used soft drink in the world uses its competitive strengths to become the world’s second-largest manufacturer of beverage. It identifies all the weaknesses, strengths, threats, and opportunities which widely affects this beverage company.

Strength

1. Domination of the market share in the Industry.

This company is the most popular and the best producer of the beverage in the whole world. It serves 1.8 billion or 3.3% of the total 61billion servings of beverage consumed globally on a daily basis. This company distributes and owns about 500 different beverage brands in nearly 200 countries worldwide.

Only nestle, and Pepsis companies can be compared to this company market shares and big size in the beverage industry. The large size of this company and its market share dominance gives it significant advantages against its competitors. The economic scales: this factor of economic scales gives this company an opportunity to share the constant prices for billion servings of several brands.  This makes the drink cheaper.

1. Power of the market over competitors and suppliers.

Coca-Cola can exhibit its power of the market through controlling the market prices and can require lower costs for them. It can underprice its goods and create market saturation with its product. Hence the smaller competitors are not able to survive.

Total powers over the consumers: this company has a signature brand and enjoys great recognition as compared to its fellow smaller competitors. Due to this, the company can control the buying decisions of the consumers owing to its brand signature.

Wider reach to the audience: distribution network of this company ensures that it reaches more consumers that its smaller competitors are not able to reach.

2. Diverse products with a $22 billion brand.

This company distributes about 550 brands; this is the most extensive brand portfolio of beverages in the Industry. The categories include.

• Carbonated Soft Drinks
• Energy Drinks & Shots
• Juice & Juice Drinks
• Alternative Drinks
• Bottled Water

Weaknesses of the Coca-Cola company.

Pepsi competitions-  Pepsi is one of the major competitors with the Coca-Cola company. If not for Pepsi, Coca-Cola would have been the total leader in the beverage market. And Pepsi is very consistent.

Diversification of products is very low; bigger competitors like Pepsi have diversified and joined the snack market, but the Coca-Cola company has not entered this market. This segment has given Pepsi a right edge since it gives it an added revenue.

Management of water- this company has been sued in some areas that it overconsumes water even in areas where water is scarce.

Opportunities.

Diversification: to diversify in the food and health industry will enhance the offerings of Coca-Cola to its clients. This will make sure that they widen their profit margin from vast revenues.

Developing countries; even though several countries which are developed have high Coca-Cola presence, these nations are moving for healthier beverages. Hence there are top opportunities to invest in developing nations.

Improvement of the supply chain-due to rising transportation costs, Coca-Cola should try to improve its supply chain to lower the costs.

Threats in Coca-Cola SWOT.

Sourcing of raw materials: the greatest Coca-Cola threat is the water. The vast water consumption and pesticides use have been suspected weakness of Coca-Cola. The biggest threat is that the water is becoming more scarce in several areas. If water is rationed or axed, the company can undergo a downfall in their profit margin.

Indirect rival competitors: chain of coffee suppliers such as Starbucks and others are rising. These companies are giving Coca-Cola a healthy competition, and they are giving it a dent in the beverage industry.

Competition

Coca-Cola is one of the most recognized companies dealing in beverage globally. It has a long history of warding off competition through the use of well-established strategies of distribution and strong messages of marketing.  This company has utilized positive marketing strategies to benefit itself and has never got involved in negative marketing like its big rivals.

competitors

• The direct competitors are; redbud, Gatorade, Pepsi, and mountain dew
• Indirect competitors include; Lipton, Tropicana, and Nescafe.

Besides the fact that the major competitor of Coca-Cola is Pepsi, both companies have dominated the market of the none alcoholic beverage. The operations are international. The Coca-Cola Company has initiated different ways toward the market, such as flooding the market with its products and reducing their prices. It has also improved its chain of supplies to various countries worldwide.

Management team/Leadership

The structure of an organization in this company is well developed in a way that all its functional operations smoothly runs and ensures the development and progress of the company. Coca-Cola has a robust structure of management but flexible to adapt to the local market requirements.

The company has members of the board, which consists of 15 members, the members comprise of the CEO (James Quincy).

Financial outlook

The year 2020 full year

The Coca-Cola company is expecting to achieve a 5% growth in revenues(none-GAAP) and relatively 9% in the comparable currencies operating neutral income (none-GAAP). For the case of comparable total revenues (none-GAAP)., this company forecasts a small tailwind in the acquisitions, structural items, and divestitures and 1%-2% headwind currency on the basis of present rates.

For the case of operating income(comparable), this company forecasts relative impacts on the acquisitions and structural items and 1% to 3% headwind currency on the basis of present rates. The underlying effective rates of tax of this company are expected to be 19.6%. Considering the above estimates, this company expects forecasts its delivery of comparable EPS of estimated $2.25 against $2.11 in the year 2019, which is about a 7% rise

This company expects to deliver a free flow of cash of about $8 billion through operation cash of estimated $10.0 billion and expenditure capital of 2billion dollars. The company’s underlying effective tax rate (non-GAAP) is expected to be 19.5%.

Given the above considerations, the company expects to deliver comparable EPS (non-GAAP) of approximately $2.25 versus $2.11 in 2019, a 7% increase. The company plans to provide free cash flow (non-GAAP) of roughly $8.0 billion through cash from operations of approximately 10.0 billion dollars and capital expenditures of roughly $2.0 billion.

Strategies

To achieve the financial projection of the Coca-Cola company, there are several strategies which have been put in place to realize these objectives these includes;

Segmentation of the market; this is the method where the market is divided according to the capacity and number of buyers and users of the necessary methods in maximizing the volume of sales hence realization of the good margin of profit.  The company uses this technique to divide the market in relations to the market which emerge.  For these emerging markets, they increase the sales volume. For the new developing countries, the major focus is on profit; hence offering small packaged improves profit margin.

Increased efficiency of finance: To achieve financial maximization, there is a need to adopt economic efficiency. Cocoa has tried to realize flexibility in finance through the implementation of the case where there is a revision of budget from zero and have to be well justified in the end.

Increasing the efficiency in processes: when the time of the process is minimized in any organization processes without any effect on quality, then the organization is termed as efficient. When demand suddenly increases, then the time of process plays a very significant role. empowerment of employees, speed and precision are the greatest t determinant of the market winners. The Coca-Cola company has tried to reshape the processes of the business and researched for the better areas to invest in. it removed the any element of process barrier and roadblocks to facilitate this strategy hence increased margin of profit.